Chapter 5.28 — COMMERCIAL CANNABIS PERMITS

The requirements in this chapter apply to all commercial cannabis business within the Town. These requirements do not apply to personal use of cultivation and cannabis.

(Code 1990, § 5.38.010; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

The following words, terms and phrases, when used in this chapter, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:

Applicant means a person who has submitted an application for a permit or renewal of a permit issued pursuant to this chapter. If the applicant is an entity and not a natural person, applicant shall include all persons having a 20 percent or more financial interest in the entity.

Application means the form provided by the Town in accordance with this chapter for the purpose of seeking a commercial cannabis permit.

Cannabis means all parts of the plant Cannabis sativa Linnaeus, Cannabis indica, or Cannabis ruderalis, whether growing or not; the seeds thereof; the resin, whether crude or purified, extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin. The term "cannabis" also means the separated resin, whether crude or purified, obtained from

cannabis. The term "cannabis" does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks (except the resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination. For the purpose of this division, the term "cannabis" does not mean "industrial hemp" as defined by Health and Safety Code § 11018.5.

Cannabis product means cannabis that has undergone a process whereby the plant material has been transformed into a concentrate, including, but not limited to, concentrated cannabis, or an edible or topical product containing cannabis or concentrated cannabis and other ingredients.

Cannabis review authority means the cannabis review authority that is comprised of Town staff that have the responsibility and authority to review and approve or deny commercial cannabis permits. The review authority includes, but is not limited to, Town staff from the Community and Economic Development Department, the Finance Department, and the Police Department. The term "review authority" shall have the same meaning.

Canopy means all areas occupied by any portion of a cannabis plant, inclusive of all vertical planes, whether contiguous or noncontiguous on any one site.

Chief of Police means the Chief of Police for the Town Police Department or designee.

Commercial cannabis activity means any commercial activity (i.e., non-personal use) involving the cultivation, possession, manufacture, distribution, processing, storing, laboratory testing, packaging, labeling, transportation, delivery, or sale of cannabis and cannabis products.

Commercial cannabis operation means an entity that engages in commercial cannabis activities.

Commercial cannabis permit means a permit issued by the Town to an applicant to perform commercial cannabis activities under this chapter. The term "permit" shall have the same meaning.

Hearing officer means the designated person that conducts administrative hearings for appeals of any action taken pursuant to this chapter. The person designated as the hearing officer for appeals pursuant to this chapter is the Town Manager.

Medicinal cannabis or medicinal cannabis product means cannabis or a cannabis product, respectively, intended to be sold for use pursuant to the Compassionate Use Act of 1996, Health and Safety Code § 11362.5, by a medicinal cannabis patient in the State who possesses a physician's recommendation.

Owner means any of the following:

(1)

A person with an aggregate ownership interest of 20 percent or more in the person applying for a permit or a permittee, unless the interest is solely a security, lien, or encumbrance;

(2)

The chief executive officer of a nonprofit or other entity; or

(3)

An individual who will be participating in the direction, control or management of the person applying for a permit.

Permittee means the person issued a Town permit under this chapter.

Premises means the designated structure or structures and land specified in the application that is owned, leased, or otherwise held under the control of the applicant or permittee where the commercial cannabis activity will be or is conducted.

Primary caregiver shall have the same meaning as in Health and Safety Code § 11362.7. A person asserting primary caregiver status must establish by written documentation that said caregiver:

(1)

Has been designated as such by the medicinal cannabis patient; and

(2)

Is a person "who has consistent assumed responsibility for the housing, health, or safety of the patient."

Property owner means the individual or entity who is the record owner of the subject property or premises where commercial cannabis activities are located or are proposed to be located.

Qualified patient shall have the same meaning as in Health and Safety Code § 11362.7.

State license means a license issued pursuant to the Medical and Adult-Use Cannabis Regulation and Safety Act, Business and Professions Code § 26000 et seq.

(Code 1990, § 5.38.020; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

(a)

Any person who intends to engage in a commercial cannabis activity shall obtain a commercial cannabis permit for the fixed location in which the commercial cannabis activity is to occur. Each separate location where commercial cannabis activities are to occur will require a separate commercial cannabis permit.

(b)

It is unlawful for any person to conduct, engage in, or allow to be conducted or engaged in a commercial cannabis activity within the Town, unless the Town has issued such person a permit under this chapter and the permit is in effect. Notwithstanding the above, the permits issued under this chapter do not provide any protection or immunity for any person from State or Federal laws, or from protection pursuant to any applicable State or federal laws.

(c)

The fact that an applicant possesses other types of State or Town permits or licenses, shall not exempt the applicant from obtaining a commercial cannabis permit under this chapter, nor shall the terms and conditions of any other such permit or license modify the requirements of a permit granted under this chapter, except that the commercial cannabis permit must be consistent with the land use entitlement issued by the Town pursuant to Title 17.

(d)

The applicant must receive all necessary land use entitlements as required by Title 17 before the Town will issue a commercial cannabis permit under this chapter.

(e)

All of the following activities are exempt from the commercial cannabis permit requirements under this chapter:

(1)

Possession, storage, manufacturing, or transportation of medicinal cannabis, or cultivation of medical cannabis in an amount consistent with Health and Safety Code § 11362.77 by a qualified patient, as that term is defined in Health and Safety Code § 11362.7, provided the qualified patient possesses, stores, manufactures, transports, or cultivates cannabis exclusively for said patient's personal medical use, and does not provide, donate, sell, or distribute cannabis to any other person. Qualified patients shall, upon request, provide appropriate documentation to law enforcement demonstrating that they have a valid physician's recommendation to use cannabis for medicinal purposes.

(2)

Possession, storage, manufacturing, or transportation of medicinal cannabis, or cultivation of medicinal cannabis in an amount consistent with Health and Safety Code § 11362.77 by a primary caregiver on behalf of a qualified patient, within the meaning of Health and Safety Code § 11362.7, provided the primary caregiver does not receive remuneration for these activities except for compensation in full compliance with Health and Safety Code § 11362.765(c) and the primary caregiver does not act on behalf of more than three qualified patients. Primary caregivers shall, upon request, provide appropriate documentation to law enforcement demonstrating that they are a primary caregiver for a maximum of three qualified patients.

(3)

Possession, processing, storage, transportation, or donation of not more than 28½ grams (i.e., one ounce) of cannabis or not more than eight grams of concentrated cannabis to persons 21 years of age or older by persons 21 years of age or older pursuant to Health and Safety Code § 11362.1.

(4)

The cultivation of up to six living cannabis plants by persons 21 years of age or older as allowed pursuant to Health and Safety Code § 11362.1.

(Code 1990, § 5.38.030; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

(a)

Each application for the establishment of a commercial cannabis permit shall be filed with the Town's Community and Economic Development Department on the form and in the manner prescribed by the cannabis review authority. The cannabis review authority shall be responsible for administering the application process set forth in this chapter.

(b)

In all cases, the application shall contain, without limitation, the following documentation:

(1)

All applicants' and owners' names, mailing addresses, telephone numbers, and e-mail addresses.

(2)

The name, telephone number, and e-mail address of the community relations contact. This shall be a person that is available 24 hours a day.

(3)

The physical address and Assessor Parcel Number (APN) of the property upon which the proposed commercial cannabis operation will be located.

(4)

Proof of legal right to occupy the premises that may include documentation of ownership of the premises, or if the premises on which the commercial cannabis operation is to occur is rented or leased, a copy of the lease signed by the property owner. A signed affidavit from all persons and entities having a right, title, or interest in the premises that is the subject of the application consenting to the application and the operation of the proposed commercial cannabis activity on the subject premises is required.

(5)

A scaled diagram of the premises, showing, without limitation, a site plan of the entire property, all entryways and exits to the buildings, parking areas, delivery/truck loading areas, trash enclosures, fences, walls, site lighting, and a floor plan showing the layout of the interior spaces and identifying all areas where commercial cannabis activities will occur.

(6)

If the applicant is a business entity or any form of entity, information regarding the entity, including, without limitation, the name and address of the entity, its legal status, and proof of registration with, or a certificate of good standing from, the Secretary of State, if applicable.

(7)

The full name, date of birth, present address and previous addresses for the past five years of all owners, supervisors, and employees of the commercial cannabis activity that is the subject of the application or, if the applicant is an entity, having a 20 percent or more financial interest in the entity.

(8)

The businesses, occupations, and employment history for the ten years immediately preceding the date of the application that all persons responsible for the operation of the commercial cannabis activity, including owners and managers, have been involved in.

(9)

All owners, supervisors, and employees of the commercial cannabis activity shall submit the following information to allow the Chief of Police to conduct a background check and investigation:

a.

The name, address, telephone number, and fingerprints of each person identified above.

b.

For each person identified above, a list of each criminal conviction, if any, whether each such conviction was by verdict, plea of guilty, or plea of nolo contendere. The list shall, for each such conviction, set forth the date of arrest, the location of the arrest, the offense charged, the court in which the applicant was prosecuted, and the offense of which the applicant was convicted.

c.

Such other information as may be required by the Chief of Police.

(10)

A copy of all applicants', supervisors', and employees' State-issued driver's license or other form of identification.

(11)

The names and address of any other commercial cannabis operations currently being operated by the applicant or owner, or that had previously been operated by the applicant or owner, and a statement of whether the authorization for any such operation had been revoked or suspended and, if so, the reason therefor.

(12)

A complete description of the type, nature, and extent of the commercial cannabis activities to be conducted.

(13)

A description of the type of State licenses that will be required for the proposed operations pursuant to the Medical and Adult-Use Cannabis Regulation and Safety Act, Business and Professions Code § 26000 et seq., including a description of the proposed total canopy area of any cultivation or nursery operation.

(14)

A detail of the procedures to be utilized at the premises, including a description of how chemicals, pesticides and fertilizers will be stored, handled, used and disposed of; and if applicable, manufacturing methods, the transportation process, inventory procedures, and quality control procedures.

(15)

A security plan outlining the on-site security measures, both physical and operational, that ensure the safety of persons and the protection of the premises from theft. The plan shall include, at a minimum, installation of security cameras, installation of electronic locking mechanisms, continuous operation of a commercial burglary and robbery alarm system that is monitored by a state-licensed operator, use of security guards when required by State regulations, and an annual written security assessment of the site by a qualified professional. The security plan must also include a lighting plan showing exterior and interior lighting that will be implemented to provide adequate security.

(16)

Proposed hours of operation.

(17)

A waste disposal plan.

(18)

A valid Town business tax certificate.

(19)

If applicable, provide the applicant's seller's permit number issued pursuant to Revenue and Taxation Code, Div. 2, Part 1 (Revenue and Taxation Code § 6001 et seq.) or indicate that the applicant is currently applying for a seller's permit.

(20)

A statement by the applicant that it has the ability to comply with all laws regulating businesses in the State that it shall maintain compliance during the term of the permit.

(21)

Authorization for the Town, its agents, and employees to seek verification of the information contained in the application.

(22)

Certification, under penalty of perjury, that all the information contained in the application is true and correct.

(23)

Any other information required by the Town.

(Code 1990, § 5.38.040; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

(a)

The review authority shall review the application for a commercial cannabis permit and associated documents and may require additional information as necessary to complete the application. The review authority may deem the application incomplete if it does not contain all required information and documents. Upon notification that an application is incomplete, the applicant shall have ten calendar days to submit all materials required to complete the application. If the application remains incomplete in excess of ten calendar days, the application shall be deemed withdrawn.

(b)

An application shall not be deemed complete unless all required application fees have been paid.

(c)

Each commercial cannabis permit shall be granted for a period not to exceed one calendar year.

(d)

Upon review of a complete application for a commercial cannabis permit, the review authority shall approve the application if:

(1)

The proposed commercial cannabis activities will comply with all the requirements of the State and this Code;

(2)

The applicant has received all necessary land use entitlements as required by Title 17;

(3)

The proposed commercial cannabis activity will comply with all provisions of this chapter;

(4)

All persons listed on the application are 21 years of age or older;

(5)

a.

The Chief of Police has approved the application based on the following criteria:

Whether the location is identified as having calls for police services significantly in excess of the average number of calls for services for similar businesses during the most recent reporting period for which statistics are available;

Whether the business poses substantial risk to the community based on the criteria in this section;

Whether the floor plan, security plan and lighting plan incorporate features sufficient to reduce or eliminate potential crime-related problems;

Whether any of the owners, supervisors, or employees of the commercial cannabis activity have violated any local or State law, statute, rule or regulation respecting the distribution, possession or consumption of illegal drugs or controlled substances;

Whether any of the owners of the commercial cannabis activity have engaged in unlawful, fraudulent, unfair, or deceptive business practices or acts;

Whether any of the owners, supervisors, or employees of the commercial cannabis activity have knowingly made a false statement of material fact or have knowingly omitted to state a material fact in a permit application, or have provided false, inaccurate, or otherwise misleading information, or failed to submit or otherwise refuse to submit to fingerprinting;

Whether any of the owners, supervisors, or employees of the commercial cannabis activity have committed any act involving dishonesty, fraud, or deceit with intent to substantially benefit him or her, or another, or substantially injure another, or has engaged in illegal use, possession, distribution, or similar action relating to illegal drugs or controlled substances;

Whether any owner, supervisor, or employee of the commercial cannabis activity has been convicted of a felony, as specified in Penal Code §§ 667.5(c) and 1192.7(c) or a drug-related misdemeanor reclassified by Penal Code § 1170.18 within the past ten years. A conviction within the meaning of this section means a plea or verdict of guilty or a conviction following a plea of nolo contendere;

Notwithstanding the above, an applicant shall not be denied solely on the basis that the applicant or any of the owners, supervisors, or employees have been convicted of a felony if the applicant has obtained a certificate of rehabilitation under State law or solely on the basis that the applicant has been convicted of a misdemeanor if the applicant has met all applicable requirements of rehabilitation pursuant to State law;

b.

If applicable, the applicant has obtained a valid seller's permit required pursuant to Revenue and Taxation Code, Div. 2, Part 1 (Revenue and Taxation Code § 6001 et seq.).

(e)

If the review authority intends to deny the application, the review authority shall specify in writing the reason for the denial of the application and notify the applicant that the decision shall become final unless the applicant seeks an appeal pursuant to Section 5.28.120 within ten calendar days of the date of service of the review authority's decision. Service of the decision shall be provided in accordance with the requirements set forth in Section 5.38.130.

(Code 1990, § 5.38.050; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

(a)

Each commercial cannabis permit shall expire at the end of the calendar year of its issuance. Any permit may be renewed by the review authority upon the submission of a renewal application by the permittee and upon determination by the review authority that the applicant meets the standards for grant of application pursuant to Section 5.28.050. At the time of consideration of a renewal application, the review authority shall consider compliance with conditions in the prior term. Applications for new commercial cannabis permits issued after October 1 shall not expire until the end of the following calendar year.

(b)

An application for renewal shall be filed with the review authority in advance of October 1 of each year. If any of the documentation and information supplied by the applicant pursuant to Section 5.28.040 has changed since the grant of the permit, the applicant shall submit updated information and documentation with the application for renewal and shall provide such other information as the review authority may require.

(c)

If a commercial cannabis permit expires without being renewed, the permittee of the expired permit must apply for a new permit pursuant to this chapter. Operations at the location shall cease until such new permit is issued.

(d)

Any application for renewal may be denied if:

(1)

The application is filed fewer than 60 calendar days before its expiration;

(2)

The permittee fails to conform to the criteria set forth in this chapter;

(3)

The permittee is delinquent in payment of Town taxes on commercial cannabis activity; or

(4)

The permit is suspended or revoked at the time of the application.

(e)

If a renewal application is denied, an applicant may file a new application pursuant to this chapter.

(f)

An application for renewal shall not be deemed complete until all application fees have been paid.

(g)

If the review authority intends to deny the renewal, the review authority shall specify in writing the reasons for the denial of the renewal and notify the permittee that the decision shall become final unless the permittee seeks an appeal pursuant to Section 5.28.120 within ten calendar days of the date of service of the review authority's decision. Service of the decision shall be provided in accordance with the requirements set forth in Section 5.28.130.

(Code 1990, § 5.38.060; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

The issuance and renewal of commercial cannabis permits shall be accompanied by payment of such fees as the Town Council may establish to recover the cost of administration of this chapter. Permit applicants and permittees are responsible for the costs of inspections, regulatory audits, financial audits, investigations, and any other fee-associated activity established by this chapter. Fees, fines, and costs specified by this chapter shall be as established by the Town Council and as set forth in the Town schedule of fees, as may be amended from time to time. The commercial cannabis permit fee for the issuance of a new permit shall be prorated based on the date business activities commence. Businesses renewing their permit shall pay the full commercial cannabis permit fee.

(Code 1990, § 5.38.070; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

(a)

A commercial cannabis permit does not create any interest in value, is not transferrable, and automatically terminates upon transfer of ownership.

(b)

When any individual, corporation, limited liability company, partnership or other type of business entity permitted under this chapter sells or transfers all or part of its corporate stock, partnership interest, or other business interest in a commercial cannabis operation, a new commercial cannabis permit shall be obtained pursuant to Section 5.28.040.

(c)

A commercial cannabis permit is issued to and covers only the permittee identified on the permit with respect to the premises identified on the permit. The commercial cannabis permit does not run with the land.

(Code 1990, § 5.38.080; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

(a)

Throughout the term of the commercial cannabis permit, each permittee shall not violate this chapter and shall comply with all of the following:

(1)

A permittee shall not change or alter the premises in a matter which materially or substantially alters the premises, the usage of the premises, or the mode or character of the business operation conducted from the premises, from the site plan contained in the diagram on file with the application, unless and until written approval by the review authority has been obtained. For purposes of this section, material or substantial physical changes of the premises, or in the usage of the premises, shall include, but not be limited to, a substantial increase or decrease in the total area of the licensed premises previously diagrammed, or any other physical modification resulting in substantial change in the mode or character of business operation.

(2)

No cannabis shall be smoked, ingested, or otherwise consumed on the premises or in any of the public places where smoking is prohibited pursuant to Section 9.32.100 and shall be compliant with the Town public place smoking regulations at all times. Cannabis businesses shall post a sign near their entrances and exits providing notice of this policy.

(3)

No person who is less than 21 years of age may be employed or otherwise engaged in the operation of the commercial cannabis permit.

(4)

No person under 21 years of age shall be allowed on the premises. The age of all persons entering the premises shall be verified for compliance prior to entry.

(5)

Each permittee shall conspicuously display its permit on the premises. Each commercial cannabis operation that engages in transportation shall carry a copy of the permit in all vehicles that transport cannabis or cannabis products.

(6)

Odor prevention devices and techniques, such as a ventilation system with a carbon filter, shall be incorporated to ensure that odors from cannabis are not detectable off-site.

(7)

A permittee shall not allow any alcohol to be stored, sold, displayed, or consumed on the premises.

(8)

A permittee shall not allow any tobacco products to be stored, displayed, sold, or consumed on the premises.

(9)

Cannabis goods that are packaged in a manner consistent with Business and Professions Code § 26120 may be visible from outside the premises provided that displays that are visible from outside the premises shall not include the words "cannabis" or "marijuana" nor shall any display include any graphic displays of cannabis leaves or plants.

(10)

All cannabis and cannabis products shall be stored in a secured and locked safe room, safe, or vault, and in a manner to prevent diversion, theft, and loss, except for limited amounts of cannabis used for display purposes, samples, or immediate sale.

(11)

Each permittee shall keep accurate records of its commercial cannabis activities and provide such records for inspection pursuant to the requirements of Business and Professions Code §§ 26120 and 26162.

(12)

Each permittee shall be responsible and liable for safety and security in and around the commercial cannabis operation, and shall provide adequate security on the premises, including lighting and alarms, to ensure the safety of the persons and to protect the premises from theft and other crimes. Each permittee shall install and maintain in proper working order video monitoring equipment capable of providing surveillance of both interior and exterior areas of the permitted establishment. Each permittee shall

maintain such surveillance video tapes for a period of at least 90 days and shall make such videotapes available to the Town upon demand.

(13)

Each permittee shall notify the Police Department within 24 hours after discovering any of the following:

a.

Significant discrepancies identified during inventory;

b.

Diversion, theft, loss, or any criminal activity involving the cannabis business or any agent or employee of the cannabis business;

c.

The loss or unauthorized alteration of records related to cannabis, customers, or employees or agents; or

d.

Any other breach of security.

(14)

Each permittee shall provide the review authority and all neighbors within 300 feet of the premises with the name, telephone number, and e-mail address of a community relations contact to whom the public can provide notice of problems associated with the commercial cannabis operation. The permittee shall make a good faith effort to resolve problems without the need for intervention by the Town.

(15)

Any new owners, employees, or other persons otherwise engaged in the operation of the commercial cannabis operation must submit their information to the review authority within ten days prior to their new employment or engagement, including fingerprints and other necessary information for a criminal background check.

(16)

No owner, supervisor, or employee may have been convicted of a felony, as specified in Penal Code §§ 667.5(c) and 1192.7(c) or a drug related misdemeanor reclassified by Penal Code § 1170.18 within the past ten years. A conviction within the meaning of this section means a plea or verdict of guilty or a conviction following a plea of nolo contendere.

(17)

A permittee shall not be delinquent in the payment of all applicable State and Town taxes and fees.

(18)

A permittee shall follow all local and State requirements for waste disposal.

(19)

The premises where the commercial cannabis operation is located must at all times have valid land use entitlements as required by Title 17 and the land use entitlements must be operative.

(20)

When applicable, the permittee must legally hold all required State licenses under the Medicinal and Adult- Use Cannabis Regulatory and Safety Act (MAUCRSA), Business and Professions Code § 26000 et seq.) and under all other applicable State codes.

(21)

At any time between 9:00 a.m. and 5:00 p.m. and without notice, Town officials may enter the premises for the purpose of observing compliance of the commercial cannabis operation with this section, including access to and inspection of the commercial cannabis operation's records, books, accounts, financial data, and any data relevant to its permitted activities for the purpose of conducting an audit or examination.

(22)

It is unlawful for any person having any responsibility over a commercial cannabis operation to refuse to allow, impede, obstruct, or interfere with an inspection, or the review of the copying of records and monitoring (including recordings), including, but not limited to, the concealment, destruction, and falsification of any recordings or records.

(23)

The cannabis business shall use a track-and-trace system that is compatible with the State approved track-and-trace system to track commercial cannabis activity and movement. Unique identifiers (UIDs) consistent with the State requirements shall be used and documented in the system to allow for the tracking of the cannabis throughout the supply chain. All activities throughout the supply chain from cultivation to retail sales shall be documented in the system.

(b)

Additional retailer requirements.

(1)

All employees and agents of a cannabis retailer involved in face-to-face sales of cannabis and/or cannabis products shall complete a responsible cannabis retailing education training program within 90 days of commencing employment at the premises. The course shall be authorized by the Town as meeting the objectives specified below. All employees shall participate in a refresher course every three years during employment.

a.

Responsible cannabis retailing education training programs shall, at a minimum, achieve the following objectives:

Educate employees on State and local regulatory requirements and best practices for cannabis retailing;

Provide them with the education and ability to verify age requirements and inform customers about the potential effects that various dosages and products may cause;

Describe practices that can lower any risks associated with cannabis use; and

Inform customers about best practices for the storage and use of cannabis to prevent access and accidental use by minors under the age of 18 years.

b.

Evidence that all employees have completed the authorized course or the refresher course shall be provided upon request by the Town.

(2)

Cannabis retailers shall obtain cannabis and cannabis products from licensed distributors only and shall ensure that all cannabis and cannabis products received came from a licensed cultivator or manufacturer and that all products underwent testing pursuant to State and local regulations.

(3)

Retailers shall not sell any cannabis or cannabis product unless the cannabis and cannabis products are labeled and in tamper-evident package in compliance with Business and Professions Code § 26120. All products sold shall be in an opaque exit package when the products leave the premises.

(4)

Bathrooms that are under the direct control of the cannabis retailer and are located within their licensed premises shall remain locked and under control of the management.

(5)

Cannabis retailers and any of the cannabis retailer's agents or employees shall not sell or offer for sale any of the following prohibited product types:

a.

Any cannabis or cannabis product that is attractive to children or youth or easily confused with commercially sold candy or foods that do not contain cannabis;

b.

Any edible product that contains more than ten milligrams THC per serving;

c.

Any edible product that contains more than 100 milligrams of THC per package for products that contains more than one serving;

d.

Cannabis or cannabis products that contain any non-cannabinoid additive such as nicotine, caffeine, or alcohol. Minimal amounts of alcohol, in as much as are residual from manufacturing or required solvents for the cannabis containing product, are allowed, provided that the alcohol content is ten percent or less, the amount of alcohol in an individual serving would not create alcohol intoxication with ingestion of a single dose, and the product is clearly labeled with both the alcohol content and a statement that reads: "Warning: This Product Contains Alcohol"; and

e.

Any product that would otherwise be classified as a potentially hazardous food (as defined in Health and Safety Code § 113871), including a food that requires time or temperature control to limit pathogenic microorganism growth or toxin formation.

(c)

Additional cultivation, manufacturing, distribution, and testing requirements.

(1)

The canopy area of cannabis located at any cultivation facility shall not exceed the maximum canopy limits set by State law. The commercial cannabis permit shall specify the maximum canopy limit allowed by the permit.

(2)

Each permittee must follow all pesticide use requirements of local, State, and Federal law and pesticides and fertilizers shall be properly labeled and stored to avoid contamination through erosion, leakage, or inadvertent damage from rodents, pests, or wildlife. A permit from the State Department of Food and Agriculture is required for the use of pesticides.

(3)

Each permittee must maintain all weighing devices in compliance with local, State, or Federal law and comply with the registration requirements of the State Department of Food and Agriculture.

(4)

In no case shall any hazardous, flammable, or explosive substances be used to process or manufacture cannabis products on-site unless all necessary permits have been obtained from the Mammoth Lakes Fire Protection District, and any other appropriate agencies.

(5)

All food products, food storage facilities, food-related utensils, equipment, and materials shall be approved, used, managed, and handled in accordance with Health and Safety Code §§ 113700 through 114437, including, without limitation, the California Retail Food Code, § 113700 et seq. All food products shall be protected from contamination at all times, and all food handlers must be clean, in good health, and free from communicable diseases.

(6)

Pursuant to Business and Professions Code § 26053, non-retailer commercial cannabis businesses shall only conduct business with other cannabis businesses that hold a State license.

(7)

Prior to transporting cannabis and/or cannabis products, the distributor shall complete an electronic shipping manifest. The shipping manifest shall include the unique identifier (UID) information from the cultivation source. A physical copy of the shipping manifest shall be maintained during transportation and shall be made available upon request to law enforcement or any agents of the State, Town, or County charged with enforcement. Cannabis distribution facilities shall maintain appropriate records of transactions and shipping manifests. An organized and clean method of storing and transporting cannabis and cannabis products shall be provided to maintain a clear chain of custody.

(8)

Distributors shall ensure that appropriate samples of cannabis and cannabis products are tested by a licensed testing facility prior to distribution.

(9)

Prior to distribution, the distributor shall inspect the cannabis and cannabis products for quality assurance.

(Code 1990, § 5.38.090; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

Any of the following shall be grounds for suspension or revocation of a commercial cannabis permit, based on substantial evidence and following the procedures outlined in Section 5.28.110:

(1)

Failure to comply with one or more of the terms and conditions of the commercial cannabis permit.

(2)

The commercial cannabis permit was granted on the basis of false material information, written or oral, given willfully or negligently by the applicant.

(3)

Any act or omission by a permittee in violation of the provisions of this chapter.

(4)

Any act or omission by a permittee in violation of State law or this Code.

(5)

Any act or omission by a permittee that results in the suspension or revocation of the applicable use permit issued under Title 17 for the commercial cannabis activities.

(6)

Any act or omission by a permittee that results in the denial, revocation, or suspension of that permittee's State license.

(7)

Failure to pay applicable State or Town taxes or fees on commercial cannabis activity.

(8)

Conduct of the commercial cannabis operations in a manner that constitutes a nuisance, where the permittee has failed to comply with reasonable conditions to abate the nuisance.

(Code 1990, § 5.38.100; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

(a)

Upon determining grounds for suspension or revocation of the commercial cannabis permit exist pursuant to this section, the Town will issue the permittee a written notice of intention to suspend or revoke the permit, as the case may be. The notice of intention shall be served on the permittee, as reported on the permit, and on the property owner. The notice of intention shall describe the premises, the intention to revoke or suspend the permit, the time limit for compliance, and the right to an appeal hearing. The notice of intention shall notify the permittee and the property owner to request an appeal hearing before the Board of Review to present evidence as to why the permit should not be suspended or revoked and shall notify them of the ten-day deadline to submit a written request for an appeal hearing.

(b)

The permittee shall have ten calendar days from the service of the notice of intention to submit a written request for an appeal hearing before the Board of Review. Failure to submit the written request for an appeal hearing shall be deemed a waiver of the right to challenge the suspension or revocation of the

commercial cannabis permit and a failure to exhaust administrative remedies. If the request is not timely requested, the Town may suspend or revoke the permit in accordance with the notice of intention. If the permittee files an appeal hearing request within the time and manner prescribed, the permit shall remain in effect until the appeal is finally determined.

(c)

If a written request for an appeal hearing is submitted, the processing of the appeal shall be conducted as set forth in Section 5.28.120.

(Code 1990, § 5.38.110; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

Appeals of any action taken pursuant to this chapter shall be heard by the hearing officer at an administrative hearing.

(1)

Upon receipt of a timely written request for an appeal hearing, the review authority shall set a date for an administrative hearing to be held within 30 days of receipt of the request, unless an immediate threat to the public health, safety, and welfare necessitates an earlier hearing date. Notice of the administrative hearing, including the time, date, and location of the hearing, shall be served in accordance with the requirements set forth in Section 5.28.130.

(2)

Administrative hearing.

a.

At the hearing, the permittee, or their representative, and the review authority shall have the opportunity to testify and submit evidence as they believe to be relevant to their respective positions. The hearing officer may require the presentation of additional evidence from either the permittee or the review authority representative, or both. The hearing officer may continue the hearing from time to time for the purpose of allowing the presentation of additional evidence.

b.

Upon completion of the hearing, the hearing officer may:

Affirm the decision of the review authority;

Reverse the review authority's decision; or

Refer the matter to the Town Council.

c.

Written notice of the hearing officer's decision shall be given to the permittee and the written decision shall constitute the final administrative decision of the Town.

d.

In the event a civil action is initiated to obtain enforcement of the decision of the hearing officer, and judgment is entered to enforce the decision, the person against whom the order of enforcement has been entered shall be liable to pay the Town's total costs of enforcement, including reasonable attorneys' fees.

e.

If the permittee, or their representative, fails to appear at the noticed hearing, such failure to appear shall constitute an abandonment of the appeal hearing request and a failure to exhaust administrative remedies.

(Code 1990, § 5.38.120; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

When this chapter requires the Town to serve notice to an applicant, permittee, or property owner, such notice shall be given by the review authority, in writing, and shall be delivered either by personal delivery or by certified U.S. mail, postage prepaid, return receipt requested. In addition, any such notice may be posted at the physical address of the premises on the date of the mailing of notice.

(Code 1990, § 5.38.130; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)

A violation of this section is unlawful and any person that violates any of the provisions of this section may be prosecuted for an infraction or a misdemeanor pursuant to Chapter 1.12.

(Code 1990, § 5.38.140; Ord. No. 20-12, § 4(exh. A, § a.), 11-18-2020)